How to invest like the Super Rich

May 14, 2013 | Securities

Proven Investment Strategies Used by the Wealthy

Want to know how to invest like the super rich? According to an article by The Wall Street Journal, a new study offers a comprehensive look at the portfolios and investment decisions of several hundred of the wealthiest families in the U.S who have a net worth of roughly $90 million.

The Wall Street Journal, suggests that every investor, rich or otherwise, can learn from how these people make the most of their advantages—and from how they mess up.

For the most part these families invest intelligently, spreading their bets widely, seldom trading and keeping their investing taxes to a minimum.

They are fortunate as they have access to privileged investments and can afford to tie up lots of money for a long time. The ultrawealthy keep about 20% of their assets in hedge funds and various forms of private equity.

However, according to The Wall Street Journal, the super rich also commit rookie mistakes. Their approach to diversification might not always be ideal. They tend to chase investment fads and freeze with fear just when bravery is most likely to be rewarded.

You, too, should think about what your comparative advantage is as an investor. Most individuals aren’t likely to have an edge in trying to beat Wall Street at its own game of fast trading and constant measurement of returns relative to a market index.

You’re better off doing what Wall Street can’t: cultivating patience, trading as seldom as possible, focusing only on those rare companies where you might know something everyone else doesn’t and, finally, rebalancing when it is hardest says The Wall Street Journal.

To lean more about how to become a successful investor, contact UGC to speak with one of our financial strategists for a No Cost, No Obligation consultation on 03 8657 7640 or email info@ugc.net.au. We would be more than happy to review your current arrangements and give you the advice you need for a more secure financial future.

The information contained in this report is General in nature and has been prepared without taking into account your objectives, financial situation and needs.

<a href="https://ugc.net.au/author/joel/" target="_self">Joel Hewish</a>

Joel Hewish

Joel is the founder and CEO of UGC. He is a licensed financial advisor with 15 years experience assisting clients grow, manage and protect their wealth.

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